Tag: "employment"

Obamacare’s Perverse Job Creation Program

doctor-with-familyThe latest jobs report gave the stock market a boost and injected some optimism into public sentiment about our economic prospects. Unfortunately there’s a problem with the current employment situation that few understand: Obamacare has likely led to too many jobs in health care, drawing labor from more productive functions.

Dan Diamond of Politico reports jobs in health care have grown 23 percent since 2005, while jobs overall have grown only 6 percent. Much of this was driven by the collapse of non-health jobs in 2008-2010, while health jobs remained undisturbed. As the economy recovered, Obamacare kept layering jobs onto health care that did not actually improve health care:

Health Services Jobs Still Dominate Employment Growth

BLSLast Friday’s thrilling jobs report, which drove the stock market to new highs, continued to be dominated by growth in health services jobs. Indeed, breathless media coverage disguised that monthly job growth followed a miserable May report (which was actually revised downward last Friday).

Health services added just 39,000 jobs in June, significantly fewer than July. Nevertheless, those comprised 13 percent of 287 thousand civilian non-health, non-farm jobs added (Table I). The warping of our economy towards the government-controlled health sector continues.

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Eight Thousand Non-Health Jobs Lost in May

BLSThe true scope of this morning’s miserable jobs report is disguised by the headline figure of 38,000 jobs gained. In fact, health services added 46,000 jobs while civilian non-health, non-farm employment dropped eight thousand (Table I). The warping of our economy towards the government-controlled health sector has reached the tipping point I have suggested for months.

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Health Jobs Grow More Than Three Times Faster Than Other Jobs

BLSHealth services jobs grew over three times faster than non-health, nonfarm civilian jobs in April. Health services jobs comprised 44,200 (28 percent) of 160,000 jobs added. The rate of growth from March was 0.29 percent for health services jobs versus only 0.09 percent for other jobs (Table I).

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Health Jobs Grow Over Two Thirds Faster Than Other Jobs

BLSHealth jobs grew more than two thirds faster than non-health jobs in March. Health jobs comprised 37,000 (17 percent) of nonfarm civilian jobs added (215,000). The rate of growth from February was 0.24 percent for health jobs versus only 0.14 percent for non-health jobs (Table I).

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Health Jobs Still Grow Faster Than Other Jobs

BLSThe latest jobs report was greeted as good news, with nonfarm payroll increasing by 242,000 jobs in February. Health services jobs accounted for 38,000 (16 percent) of the growth. Health services jobs accounted for a smaller share of job growth than in previous months. Nevertheless, they grew faster (0.25 percent) than other nonfarm jobs (0.16 percent) (Table I).

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Huge Health Jobs Hike, Especially in Hospitals

BLSThis morning‘s tepid jobs report (Employment Situation Summary) was dominated by health services, which added 37,000 jobs in January. That is just one percentage point shy of one quarter of all nonfarm civilian jobs added (Table I).

Within health care, hospitals dominated, accounting for 24,000 of the 37,000 increase – almost two thirds. (This is interesting because there has been a slowdown in health construction starts. So, there must be a lot of slack in already built facilities.) Hospitals are generally inefficient locations of care, so the pickup in employment in January is actually of concern because it likely indicates more expensive care.

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Who Pays Obamacare’s “Slacker Mandate”? Workers with No Kids!

LGBT-ACA-ADThe “slacker mandate” is the provision in Obamacare requiring employer-based health plans to offer benefits to adult dependents of their workers, up to age 26. I previously discussed research showing the mandate reduced work among adults, aged 19 to 26, and increased the time they spend socializing, sleeping, and exercising.

What about the financial costs of the mandate? Speak to an insurance agent or benefits consultant and they will tell you the cost are fully borne by working parents. In the old days, employer-based health insurance was offered to workers in three sizes: Single, couple, or family. It did not matter how many kids you had. Today, each dependent adds to the premium. So, the “slacker mandate” is paid for by the working parents. That is not really a problem for society. However, there is more to the story.

A remarkable study published by the National Bureau of Economic Research concludes this happened. The slacker mandate reduced wages among workers without children by $211 a month, but did not reduce wages among workers with children (either minor or adult) by a statistically significant amount.

Health Jobs Pick Up in Booming Jobs Report

BLSToday’s Employment Situation Summary, which came in above strong expectations, also saw faster growth in health services jobs than other nonfarm civilian jobs. In December, health services jobs grew at 0.26 percent, versus only 0.20 percent for other jobs. Health services jobs comprised 13 percent of the 292,000 jobs added in December (Table I).

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Within health services, outpatient care jobs grew much faster than jobs at other facilities. Overall, jobs at ambulatory facilities grew faster than hospital jobs. This is a good development because hospitals are less efficient locations of care.

How Obamacare Crushes Working Class Job Opportunities

Family and Their HouseThe Congressional Budget Office recently confirmed its estimate that Obamacare will shrink the workforce by 2 million full-time equivalent (FTE) jobs in 2025. When the CBO first published its (initially somewhat larger) estimate, in February 2014, it felt compelled to wriggle around the headline, claiming that it did not really mean what it said.

It is strictly true that some of this job loss will be “voluntary,” in that Obamacare’s subsidies will cause them to seek less work than otherwise. Those individuals will probably feel better off than if they had been laid off or fired. However, cutting back working hours because government subsidies encourage it is not quite the same as cutting back because you have changed your priorities – either economically or morally.

The new analysis allows us to see where the burden on employment lies – mostly on those eligible for tax credits in Obamacare’s exchanges. These are people who earn between 100 percent (or 138 percent, depending on the state) and 400 percent of the Federal Poverty Leve. For a family of four this ranges from $24,250 to $97,000 in 2016.